Urgent announcement affecting EMI share options

21st May 2018

Urgent announcement affecting EMI share options

The European Commission has granted fresh EU State Aid approval for the prolongation of the UK Enterprise Management Incentive (EMI”) scheme, known generally as ‘EMI Share Options’.

This follows a period of uncertainty for EMI Share Options, which started when HMRC issued a bulletin on 4 April 2018 announcing that EU State Aid Approval for EMI Share Options would lapse on 6 April 2018 and, consequently, that EMI Share options granted on and from 7 April 2018 may not qualify for the favourable tax treatment ordinarily associated with such options.

Companies will generally welcome the EU Commission's decision, on the basis that EMI Share Options are an important tool which they can use to retain, incentivise and reward key members of staff.

There has been no official comment from HMRC regarding the EU Commission's decision at this stage. If and when HMRC does issue an official response it will hopefully confirm the EU Commission's statement and will clarify any remaining uncertainty surrounding the tax treatment of those EMI Share Options granted between 7 April 2018 and 14 May 2018 (notwithstanding HMRC's bulletin referred to above).

Companies may now wish to reconsider or implement previously postponed decisions to grant EMI Share Options in order to attract and retain their key staff members. We are able to advise Companies on the benefits associated with EMI Share Options and to implement such schemes on their behalf.

If you wish to discuss any of the content above in more detail, please contact Craig Thomas, Jonathan Hunter or Susheel Gupta.

This note is for general guidance purposes only and does not constitute legal or professional advice. Appropriate legal advice should be taken before action is taken


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